The purpose of the paper is to learn to evaluate a financial institution on performance, competitive structure and the environment of operation. The financial institution that we have chosen is Nordea.

Nordea is a very remarkable and innovative financial institution, the company it self have managed to get up in the top 4 league in Europe of commercial banks. It is the leading financial group institution in the Nordic and Baltic region.

The evaluation should provide a general understanding of how a financial institution operates and the insight of the environment that surrounds it. In the evaluation it is required that we touch some specified areas:

• Description of institution• Environment of operation• Competitors• Analysis of key-figures• Understanding the risk models• Conclusion of the work

Financial sector consists of banking, financial mediation, insurance, leasing, securities, audit and some other related services. Absolutely the biggest share of finance and capital market in Lithuania is held by banks. Other players — insurance companies, investment management companies, investment funds, private pension funds etc. have a relatively small share of the capital market.

This year Lithuania‘s financial sector have been particularly hard hit by the global financial crisis. After credit markets came close to collapse in 2008, Lithuania struggled to cope. The budget deficit is forecast to widen to -5% of GDP in 2009. However, the downturn is likely to be more severe in Latvia and Estonia than in Lithuania because the bubble of growth was larger in the former two and Lithuania's economy is more diversified. With credit becoming scarcer in all these economies, consumer expenditure is likely to contract.

As you can see in the chart, provided by Eurostat, even before the credit crunch deepened, Lithuania‘s (together with Latvia‘s and Estonia‘s) economy was experiencing difficulties ...